Your predecessor-in-office asked this office to construe section 142.005 of the
Health and Safety Code. Chapter 142 of the Health and Safety Code applies to home
health services, which are defined generally as "the provision, for pay or other
consideration, of a health service in a patient's residence." Health & Safety Code
§ 142.001(5); see also 25 T.A.C. § 115.2. Any person--which term is defined to include
an individual, corporation, or association, Health & Safety Code § 142.001(6)--that
desires to engage in the business of offering home health services first must obtain a
license from the Department of Health (the "department"). Id. § 142.002(a); see id.
§ 11.001(3) (defining "department"). An applicant for a license to offer home health
services must, among other things, complete an application as prescribed by the
department and pay a license fee. Id. § 142.004(a)(1), (4); see id. § 142.010 (specifying
ranges for various license fees that department must set and collect). Non-individual
applicants must comply with additional license application requirements, which the
legislature has articulated in section 142.005 of the Health and Safety Code. Section
142.005 provides in pertinent part as follows:

(a) If an applicant for a license, other than a renewal or branch
office license, proposes to operate a home health agency through a
partnership, corporation, or other business entity that includes
members that are not individuals, or through a corporation the
shares of which are owned by another corporation, the applicant
must:

(1) establish a corporation under the laws of this state if
the applicant is not a corporation organized under the laws of this
state.

The legislature codified the statutory predecessor to chapter 142 of the Health and
Safety Code, V.T.C.S. article 4447u, in 1989. See Acts 1989, 71st Leg., ch. 678, § 1, at
2370-71. The legislature expressly stated that the codification was nonsubstantive. See
Acts 1989, 71st Leg., ch. 678, § 1 (caption to act). The legislature had enacted article
4447u, V.T.C.S., in 1979. See Acts 1979, 66th Leg., ch. 642, at 1466. Article 4447u did
not include a provision similar to section 142.005 of the Health and Safety Code,
however, until 1987, when the legislature added section 7A. See Acts 1987, 70th Leg.,
ch. 1091, § 5, at 3702.

Representative Barton proposed adding section 7A on the floor of the house
during the second reading of Senate Bill 1371. See Debate on S.B. 1371 on the Floor of
the House, 70th Leg. (May 29, 1987) (statement of Representative Barton) (tape on file
with House Committee Coordinator); H.J. of Tex., 70th Leg., at 3899 (1987).
Representative Barton stated only that the amendment he proposed would "strengthen
licensing procedure." Debate on S.B. 1371 on the Floor of the House, 70th Leg. (May
29, 1987) (statement of Representative Barton) (tape on file with House Committee
Coordinator). We were unable to find any additional legislative history indicating the
intent of section 142.005's statutory predecessor.

Your predecessor-in-office first asked whether the language in section 142.005(a)
regarding a business entity "that includes members that are not individuals" applies only
to a nonprofit corporation. Your predecessor stated that the department believes that the
quoted language refers only to a nonprofit corporation because a nonprofit corporation is
the only type of corporation that has members; a for-profit corporation, on the other
hand, has shareholders, not members. We disagree.

Based on our reading of section 142.005, we believe that the legislature intended
all non-individual applicants to comply with the additional license application
requirements articulated in subsection (a), regardless of the business entity's structure
(e.g., limited partnership, general partnership, corporation) or whether the business entity
is for-profit or nonprofit. While we agree that "business entity that includes members"
describes a nonprofit corporation, see V.T.C.S. art. 1396-1.02(A)(6) (defining "member"
as "one having membership rights in a [not-for-profit] corporation in accordance with the
provisions of its articles of incorporation or its by-laws"); see also 15 TEX. JUR. 3D
Corporations § 502, at 644-45 (1981), we understand that it may describe other business
entities as well. For example, we are advised that a limited liability company is a recent
hybrid between a corporation and a partnership; the owners of a limited liability
company are called members. We understand that the development of the limited
liability company postdates the enactment of section 142.005's predecessor; however, in
our opinion, the legislature employed broad descriptive language in section 142.005(a)
instead of a list of specific types of business entities so that the section would apply to
every business entity that desires to operate a home health agency. We conclude,
therefore, that "business entity that includes members that are not individuals" in section
142.005(a) of the Health and Safety Code encompasses not only nonprofit corporations
but also for-profit business entities that include members that are not individuals.

Your predecessor-in-office next asked whether the language in section 142.005(a)
regarding a "corporation the shares of which are owned by another corporation" refers to
a corporation in which another corporation owns any of the shares, or whether it refers to
a corporation in which another corporation owns all of the shares. In our opinion, the
language of the predecessor statute, V.T.C.S. article 4447u, section 7A, is instructive.
Prior to codification in 1989, V.T.C.S. article 4447u, section 7A(a) read in pertinent part
as follows: "If an applicant for a license . . . proposes to operate a home health
agency . . . through a corporation in which any of the stock is owned by another
corporation . . . ." Acts 1987, 70th Leg., ch. 1091, § 5, at 3702 (emphasis added). When
a conflict exists between a former statute and a revision the legislature has made pursuant
to a proposal for nonsubstantive revisions from the Texas Legislative Council, the former
statute will control. See Johnson v. City of Fort Worth, 774 S.W.2d 653, 654-55 (Tex.
1989). Consequently, we must read "any" into section 142.005 of the Health and Safety
Code. Thus, a "corporation the shares of which are owned by another corporation" in
section 142.005 refers to a corporation in which another corporation owns any of the
shares.

Finally, your predecessor-in-office asked whether a foreign corporation registered
to do business in the State of Texas must establish a domestic corporation to meet the
requirements of section 142.005(a)(1) of the Health and Safety Code. To the extent that
section 142.005(a)(1) is ambiguous, we believe that the language of V.T.C.S. article
4447u, section 7A is instructive. Prior to codification, subsection (a)(1) required an
applicant to "establish a corporation under Texas law if the applicant is not a Texas
corporation." Id. In our opinion, article 4447u, section 7A required a foreign
corporation to establish a Texas corporation to meet the requirements for licensing as a
home health agency. We construe section 142.005 of the Health and Safety Code
consistently with its statutory predecessor. See Johnson, 774 S.W.2d at 654-55.

Your predecessor-in-office pointed out that an interpretation of section
142.005(a)(1) that requires a foreign corporation registered to do business in the State of
Texas to establish a domestic corporation may contravene article 8.02(A) of the Texas
Business Corporation Act. Article 8.02(A) provides that a foreign corporation that has
registered in accordance with the Business Corporation Act shall "enjoy the same, but no
greater, rights and privileges as a domestic corporation organized for" the same purposes.
Because article 8.02 of the Business Corporation Act concerns foreign corporations
generally, while section 142.005 of the Health and Safety Code concerns only foreign
corporations that desire to operate a home health agency in Texas, article 8.02(A) is a
more general statute than section 142.005. If a general statute and a special statute
conflict, the special statute prevails as an exception to the general statute. Gov't Code
§ 311.026(b); Attorney General Opinions JM-1237 (1990) at 4; WW-482 (1958) at 2.
Accordingly, this interpretation of section 142.005(a)(1) of the Health and Safety Code
does not contravene article 8.02 of the Business Corporation Act.

SUMMARY

In the context of section 142.005(a) of the Health and Safety
Code, "business entity that includes members that are not
individuals" encompasses not only nonprofit corporations but also
for-profit business entities that include members that are not
individuals. Again in the context of section 142.005(a),
"corporation the shares of which are owned by another corporation"
describes a corporation in which another corporation owns any of
the shares. Section 142.005(a)(1) requires a foreign corporation to
establish a Texas corporation if the corporation desires to be
licensed to operate a home health agency in Texas.

Very truly yours,

DAN MORALES
Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Deputy Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

MADELEINE B. JOHNSON
Chair, Opinion Committee

Prepared by Kymberly K. Oltrogge
Assistant Attorney General

Footnotes

1. In the context of chapter 142 of the Health and Safety Code, "residence" refers to any place
where a person resides, including a home, a nursing home, or a convalescent home for the disabled or
aged. Health & Safety Code § 142.001(8); see also 25 T.A.C. § 115.2.

2. You do not ask, and therefore we do not consider, whether section 142.005(a)(1) of the Health
and Safety Code is constitutional.